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Stages Of Enterprise Resource Planning Journey And Their Benefits

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Questions:

1.What are the Possible Stages in an ERP Systems Journey.

2.Why an ERP Systems Journey May Never End.

3.Identify the Drivers and Barriers for Companies to move from one Stage to the next.
 
 

Answer:

Introduction

Enterprise Resource Planning (ERP) is business process management software that offers an integrated platform to plan and manage the overall business activities and also to organize the back office functions that are associated with the functioning of the organization. The implementation of ERP in an organization is a step by step process that is made up a number of different steps in between. It is often believed that once the ERP systems are released and the go-live of the same is achieved, the task comes to an end. However, there is a lot of post go-live work and support that is necessary to ensure the smooth functioning of the ERP systems that are implemented in an organization (Dantes and Hasibuan, 2010). The document covers the stages that are associated with ERP journey and also highlights the benefit of each stage. There are also certain barriers that are associated in the process of moving from one stage to the other and they have been covered in the report. There are several case studies that have been used as a reference to explain the concepts that are related to the stages of ERP journey.

1.Stages of an ERP Journey and their Benefits

Discovery and Planning Stage

This is the first stage that is involved in the ERP journey and it initiates the design and implementation of ERP systems in association with an organization. The business needs along with the goals and objectives are identified in this stage with the aid of analysis and studies along with several business meetings. One of the major activities that are covered in this stage is the identification of the project team members. The project team is identified in this stage and the duties and responsibilities are allocated to the team members. This stage is also the foundation of the overall ERP journey and the documentation of the main processes and requirements is also done in this stage (Matende and Ogao, 2013). Other activities that are covered in this stage include the analysis of the risks that may be associated with the ERP journey, identification of potential gaps and understanding of the possible solutions. The outcome of this stage is in the form of a project plan that covers all of these details in the form of a document.

There are several benefits that are offered by this stage during the ERP journey. The foundation of the ERP systems is identified and finalized in this stage. Also, the senior management and the project leader get to understand the specifications and requirements. A complete overview of the steps to be covered in the later stages is decided and reviewed in this stage of the ERP journey. Deloitte is a multi-national professional services firm with its headquarters in the United States. It suggests that this stage of ERP journey is the most significant stage and follows the same in their approach of the completion of ERP implementations (Deloitte, 2017).

Design Stage

The design is the second stage in the ERP journey that comes after the planning and discovery stage. The master records that are provided by the client are reviewed in this stage. ERP system orientation and walkthrough is then carried out in this stage for the stakeholders and especially for the project resources. Initial system configuration settings are established in this stage of the ERP journey. Creation of the prototypes along with the defining the user roles is a key activity that is covered in this stage. The outcome of this stage is in the form of the documentation of ERP procedures (Kandananond, 2014).

 


The benefits of this stage include the identification of the design prototypes along with the definition of the user roles that are associated with the ERP systems. The project team gets to understand the overall design of the systems that are required to be implemented (Kocakulah and Willett, 2011).

Development Stage

The primary objectives of this stage are to develop an environment for the creation of the ERP systems along with preparing for the go-live of the systems to come up with a system developed as per the specifications and requirements.

Customization of the ERP systems along with the incorporation of qualities such as flexibility, scalability and adaptability is done in the development stage. The required codes are created to make the system ready for go-live and unit testing is also carried out on the ERP systems to identify the initial set of bugs and defects (Hasibuan and Dantes, 2012).

Simulation of the live environment is also done in this stage of the ERP journey. This stage has numerous benefits as the end product that is the ERP systems and their performance depend upon the activities that are done in this stage. Also, the initial process of validating the developed system against the specifications is done to ensure that the changes are identified in a timely manner (Ganesh and Mehta, 2012).

Testing and Deployment Stage

Testing is an activity in which the system that is developed is validated and verified against the requirements and specifications. The testing stage in ERP journey has the same objectives as it aims to validate the system and the functionalities that are implemented against the specifications and requirements provided by the client. Also, the stage aims to establish the proficiency for the end user along with fine tuning of the configuration (Chofreh, Goni and Jofreh, 2011).

There are various activities covered in this stage such as user acceptance testing that is carried out by a testing team along with a group of end users. Also, various other testing tasks are carried out on the system such as system testing, performance and security testing and likewise. Implementation of the ERP systems is not an easy journey to make as there is a transition that takes place from the old systems to the new systems. The testing stage covers the establishment of the cut-off strategy along with adjustment of the configurations (Ranjan, Jha and Pal, 2016).

The deployment stage is the go-live stage in which proficiency of the end user is assessed and established. A decision on the go and no-go is also taken along with loading of the static and dynamic data. The validation and balancing against the legacy system is also done in this stage. The users are delivered with the system along with all of its components and functions.

 


There are several benefits that are associated with this stage as the defects and the deviations in terms of the functionality are identified in this stage. The changes are also managed in this stage along with the assessment of the end-user proficiency. This is the stage that covers the activities through which the end-user experience along with the usability and satisfaction is enhanced (Sari, Hidayanto and Handayani, 2012).

Ongoing Support

This is the stage in which the post-production support is provided to the users in terms of the assistance with the system functions along with the resolution of user queries.

This is the stage in which the end users are also provided with the user manuals and system documentation in order to provide them with the trainings on the system (Sadrzadehrafiei et al., 2013).

2.ERP Systems Journey May Never End

Infosys is an information technology firm that provides IT business solutions and services to the customers. The company provided an e-commerce solution for Becton, Dickinson and Company (BD) on Hybris platform along with SAP solution at the back-end. The ERP implementation that was done by Infosys on Hybris and SAP platforms was termed as process that required continuous development. It was because of the reason that the post-production support that was required for the project went on for many years after the deployment. Technology is something that keeps on changing at a rapid scale and therefore it becomes necessary to install updates in to the deployed ERP systems (Infosys, 2017).

ERP implementation at Hershey’s was a major failure due to the issues associated with testing, project scheduling and overall management of the project. The company made some major mistakes in terms of the estimation of the user demands and also missed out on the key activities such as testing and user trainings. A big band implementation approach was followed at Hershey’s instead of the step by step implementation which resulted in a big failure as a result. Also, a turnaround time of 30 months was demanded by Hershey’s instead of the estimated schedule of 48 months. All of these errors in the estimation and calculation along with the inability to accomplish the ERP journey with adequate organization and management led to the failure of the project (Gross, 2017).

It can therefore be concluded that ERP journey is a non-stop process and the project does not end with the completion of the go-live process. There are various post-production activities that are required to be taken seriously and accomplished in order to ensure that there are no issues with the quality and performance of the ERP Systems (Albarakati, 2015).

 

Final Documentation

It is extremely necessary to document the project right in order to ensure that these documents may be used later as not only references but also to understand the issues easily at the advanced stages of the project. For instance, it would not be possible for the project resources to clearly outline all of the project risks that were analyzed during the deployment stage without the presence of the project plan. Similarly, the steps that shall be taken to execute a particular function cannot be done without the presence of a user manual.

The final documentation shall not only cover the documents highlighted in the project deliverables but shall also include the information on the decisions that were made during the project lifecycle, lessons that were acquired by the project resources along with the details on the approvals and sign offs (Madanhire and Mbohwa, 2016).

Help Desk and On-Site Support

There may be various scenarios after the deployment of the project that the users may face in terms of issues in the execution of a particular functionality or inability to resolve an error and likewise. ERP implementations vary from one organization to the other and there cannot be a defined and a generalized guideline provided to the users. It would therefore be essential to set up a help desk for the recording and resolution of the incidents. Also, on-site support shall also be set up to make sure that the users are assured of assistance at any time with just a click of a button (Al-Mashari, Zairi and Okazawa, 2006).

Additional Training

It is not necessary that the project team resources that began with the ERP system project continue with the organization till the very end. There may be resources that may join the project team in between or after the go-live stage as well. The organization shall therefore be equipped with the training documents and training material for the project team as well as the end users. The trainings that are designed for the end-users shall keep in to perspective the users of all the age groups and categories such as individual users, business users, senior citizens, non-technical users and likewise (Hollinger, 2001).

Scalability and Upgrades

Technology is something that is changing at a rapid scale and it is necessary to ensure that the ERP systems that are designed and implemented are in accordance with the changing nature of technology. These systems shall be automatically and manually upgraded after a fixed interval of time and shall also have the scope to be scaled up or scaled down as per the requirements and preferences. Such practices will not only lead to enhanced user experience but will also provide increased security to the systems.

Continued Improvement

The ERP journey is therefore a continued process to achieve improvements and enhancement all the way. Successful ERP implementation requires adequate planning, designing, development, testing, and deployment along with an endless post-production support as well. LG Electronics succeeded in implementing ERP systems in their infrastructure and processes with continuous improvement as their approach during the project. The project was accomplished in a series of five planned phases and there was also post-production support provided to the users and the stakeholders to ensure that there were no issues in terms of performance and usability (Seth, 2014).

 

3..Drivers and Barriers for Companies to Move from One Stage to the Other

There are certain barriers and challenges that the companies face during the implementation and completion of ERP projects. The major barrier that has been observed is in the form of compatibility issues between the different ERP modules and problems to integrate these modules as a single unit. The compatibility issues lead to the barrier in moving the project to the next stage.

Another major barrier that has been observed is in the form of the project approach that is followed. It is often seen that a traditional approach is followed in the projects that include the total completion of one stage before moving on to the other. The agile approach shall therefore be followed in the projects instead of the traditional practices to make sure that testing of the projects is carried out all throughout and not only in the testing phase of the project. It would also ensure that the clients are actively involved during the ERP implementation to provide their valuable feedbacks and comments (Seo, 2013).

Another issue that has been observed is in the form of the skills of the project resources along with the changes that appear during the migration and transition from the existing systems to the new systems. ERP implementations in the organizations lead to numerous changes in terms of the business processes and operations along with the methodologies that are followed. The skill sets of the project resources also sometimes do not fall in line with the required set of skills and abilities. All of these changes and issues can be overcome with the help of training sessions organized for the project team members (Candra, 2011).

Conclusion

ERP systems have become an integral part for the present day organizations and it has become necessary to ensure that the implementation of these systems is done correctly. The ERP journey is a never ending journey and it goes on after the go-live stage of the project as well. There are various phases in the ERP journey that include discovery and planning stage, design stage, development stage, testing and deployment stage along with ongoing support. The last stage that is the ongoing support or the post-production support include the various processes such as final documentation, help desk and onsite support, continuous improvement and upgrades. There can be several challenges that may be associated with the ERP implementation process that may include issues with the changes, problems in the skills of the resources, project approach and compatibility issues.

 

References

Albarakati, A. (2015). Enterprise Resource Planning (ERP) Implementation in Institutions and its Civilizing Temperament/Nature. International Journal of Applied Information Systems, 8(7), pp.20-24.

Al-Mashari, M., Zairi, M. and Okazawa, K. (2006). Enterprise Resource Planning (ERP) implementation: a useful road map. International Journal of Management and Enterprise Development, 3(1/2), p.169.

Candra, S. (2011). The Road of ERP Success: A Framework Model for Successful ERP Implementation. Binus Business Review, 2(2), p.1118.

Chofreh, A., Goni, F. and Jofreh, M. (2011). Enterprise Resource Planning (ERP) Implementation Process: Project Management Perspective. Advanced Materials Research, 338, pp.152-155.

Dantes, G. and Hasibuan, Z. (2010). The Impact of Enterprise Resource Planning (ERP) System Implementation on Organization: Case Study ERP Implementation in Indonesia. IBIMA Business Review Journal, pp.1-10.

Deloitte, (2017). Your guide to a successful ERP journey Top 10 change management challenges for Enterprise Resource Planning implementations. [online] Available at: https://www2.deloitte.com/content/dam/Deloitte/mx/Documents/human-capital/01_ERP_Top10_Challenges.pdf [Accessed 29 Mar. 2017].

Ganesh, L. and Mehta, A. (2012). Understanding Cloud Based ERP Implementation in Light of Conventional ERP Implementation at Indian SMEs: A Case Study. SSRN Electronic Journal.

Gross, J. (2017). https://www.pemeco.com/wp-content/uploads/2013/09/Hershey_ERP_Case_Study.pdf. [online] Available at: https://www.pemeco.com/wp-content/uploads/2013/09/Hershey_ERP_Case_Study.pdf [Accessed 29 Mar. 2017].

Hasibuan, Z. and Dantes, G. (2012). Priority of Key Success Factors (KSFS) on Enterprise Resource Planning (ERP) System Implementation Life Cycle. Journal of Enterprise Resource Planning Studies, pp.1-15.

Hollinger, K. (2001). ERP - The Never-Ending Journey. [online] 1, pp.1-2. Available at: https://www.vvsgidas.lt/get.php?id=314 [Accessed 29 Mar. 2017].

Infosys, (2017). E-commerce Solution on Hybris Platform for BD - Case Studies | Infosys. [online] Infosys.com. Available at: https://www.infosys.com/industries/life-sciences/case-studies/Pages/hybris-ecommerce-platform.aspx [Accessed 29 Mar. 2017].

Kandananond, K. (2014). A Roadmap to Green Supply Chain System through Enterprise Resource Planning (ERP) Implementation. Procedia Engineering, 69, pp.377-382.

Kocakulah, M. and Willett, D. (2011). Enterprise Resource Planning (ERP) System Implementation: Promise and Problems. Review of Business Information Systems (RBIS), 7(3), p.35.

Madanhire, I. and Mbohwa, C. (2016). Enterprise Resource Planning (ERP) in Improving Operational Efficiency: Case Study. Procedia CIRP, 40, pp.225-229.

Matende, S. and Ogao, P. (2013). Enterprise Resource Planning (ERP) System Implementation: A Case for User Participation. Procedia Technology, 9, pp.518-526.

Ranjan, S., Jha, V. and Pal, P. (2016). Literature review on ERP implementation challenges. International Journal of Business Information Systems, 21(3), p.388.

Sadrzadehrafiei, S., Chofreh, A., Hosseini, N. and Sulaiman, R. (2013). The Benefits of Enterprise Resource Planning (ERP) System Implementation in Dry Food Packaging Industry. Procedia Technology, 11, pp.220-226.

Sari, N., Hidayanto, A. and Handayani, P. (2012). Toward Catalog of Enterprise Resource Planning (ERP) Implementation Benefits for Measuring ERP Success. The Journal of Human Resources Management Research, pp.1-16.

Seo, G. (2013). Challenges in Implementing Enterprise Resource Planning (ERP) system in Large Organizations: Similarities and Differences Between Corporate and University Environment. [online] Available at: https://ic3.mit.edu/ResearchSamples/2013-07.pdf [Accessed 29 Mar. 2017].

Seth, S. (2014). LG As A Case Study Of A Successful Enterprise Resource Planning System. [online] Investopedia. Available at: https://www.investopedia.com/articles/investing/111214/lg-case-study-successful-enterprise-resource-planning-system.asp [Accessed 29 Mar. 2017]

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